In a calculated shift, administration officials have stopped demanding that China let its currency, the yuan, float freely against other major currencies.

Instead, American officials are telling Chinese leaders that they can keep their policy of a fixed exchange rate - at least for now - if they increase the value of the yuan by 10 to 15 percent.

The policy switch reflects a growing realization that Beijing is simply not going to let its currency soar, which would make its exports more expensive and could disrupt China's troubled banking system.